What it is
Asset finance lets a business acquire vehicles, machinery or equipment and pay for it over time, with the asset itself as the main security. In Sri Lanka this is mostly provided as finance leasing and hire purchase by banks and licensed finance and leasing companies.
Lenders finance a share of the asset's value (the rest is your down payment), with terms that typically follow the asset's useful life. New and registered used assets are both financed, usually on different terms.
How to compare
Share of value financed
Sets your down payment; it differs by asset type, age and regulations in force.
Rate and whether it is flat or reducing
A flat rate looks lower than the equivalent reducing-balance rate — compare like with like.
Term and balloon options
Longer terms lower instalments but raise total cost.
Insurance and documentation charges
Comprehensive insurance is normally mandatory and can be arranged through the lender at a cost.
Early settlement terms
Settling early can carry a fee; check before you sign.
What the bank will ask for
- Business registration and owners' NICs
- Quotation or pro-forma invoice for the asset (and valuation for used assets)
- Recent bank statements and accounts
- Guarantors for some facilities
- Proof of how the asset will earn (contracts, route permits, etc.) where relevant
Requirements vary by bank and facility size; this is the usual starting list.
Related business services
SME Loans
Term loans and credit lines for small and medium enterprises, from banks and licensed finance companies — with what to compare and what lenders will ask for before you apply.
Working Capital Finance
Short-term finance that keeps day-to-day operations running — overdrafts, revolving loans and trade facilities — and how to choose between them.
Business Fixed Deposits
Put surplus business cash to work for a fixed term — how corporate deposits work, what to compare and how to keep them safe.
Not sure which bank fits your business?
Send one enquiry; we'll come back with the options that match.